“Much ado about Islamic banking as Nigeria moots policy shift”

Christian groups in Nigeria fear a move by the country’s central bank to introduce Islamic banking could fan the flames of the country’s deep rooted religious conflict. Tayo Elegbede, a Commonwealth Correspondent from Lagos, reports.

A move by the Central Bank of Nigeria to introduce an Islamic banking system in Nigeria has generated much controversy over the last three months.

The practice of Islamic banking is synonymous to that of conventional banking except that it operates in accordance with the rules of Sharia, known as Fiqh al-Muamalat.

The basic principle is the sharing of profit and loss and the prohibition of riba (interest).

According to the Central Bank, Islamic banks would be referred to as non-interest banks, considering Nigeria’s diversity in religion. This has notwithstanding doused the tension raised by the bid to introduce Islamic banking policy in Nigeria.

However, some Christian groups have vigorously opposed the idea.

In his reaction to the development, the Kaduna State chapter of the Pentecostal Fellowship of Nigeria, Bishop David Bakare, noted that the move could foment interreligious conflict within the country. “Honestly, if Governor Sanusi Lamido Sanusi had done this advocacy for Islamic banking as a religious leader, it would have made a better sense than as a government official,” he said.

“Sanusi should come out and tell the nation whose errand he is running and for who he speaks. Is it for himself, Islam, or the government of Nigeria? The PFN, Kaduna State, strongly condemns the Central Bank governor’s Islamic banking agenda at a time like this in Nigeria when we are still battling to douse the tension created by the last ‘political’ crisis with all the evident religious manifestations.

“This obviously is an insensitive and reckless act of the highest order coming from such a high ranking officer of the Federal Republic of Nigeria. No right thinking Nigerian would ordinarily venture into such a sensitive matter at any time in such a nation like Nigeria without an evil motive to create more tension in the nation or worse still to start another religious fighting such as had never been before in this nation.

“Somebody, please, help tell Sanusi to let the sleeping dog lie, and not put the nation into another avoidable distraction and dangerous crisis. We call on President Goodluck Jonathan not to wait until trouble begins before acting.”

Similarly, the Christian Association of Nigeria called the introduction of Islamic banking a move to “Islamize Nigeria.”

On the contrary, Professor Akpan Ekpo, the director-general of the West African Institute for Financial and Economic Management, owned by Central Banks of Anglo-speaking West African countries, maintained that the introduction and operation of “Islamic banking will benefit Nigeria’s economy”. He noted that the policy does not prevent non-Muslims from participating.

Sanusi has responded to criticisms by saying that the attention to Islamic banking at the central bank predates his tenure and that what is called “non-interest banking” attracts the involvement of non-Muslims as well, including backers of the JAIZ Bank. Sanusi has also highlighted the presence of Islamic banking systems in other countries around the world, including the United Kingdom.

According to Alex Thurston, the controversy has relevance for at least three reasons. First, it affects Muslim-Christian relations, and shows how inter-religious tensions appear not only “on the ground” in terms of physical conflict, but also in debates among elites over questions of national policy.

Second, it forms part of ongoing changes in Nigeria’s financial system. Finally, this controversy will be another challenge – and opportunity – for Governor Sanusi, who is one of the most important figures now in Nigerian politics.

Judging from the wide press coverage the controversy is receiving, many Nigerian elites will be watching closely to see how the controversy unfolds.

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Opinions expressed in this article are those of the author and do not necessarily represent the views of the Commonwealth Youth Programme. Articles are published in a spirit of dialogue, respect and understanding. If you disagree, why not submit a response?